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Gold prices remain stable as Trump's tariff plans for reciprocal tariffs raise concerns

The gold price remained stable on Wednesday, as investors rearranged their positions in anticipation of U.S. president Donald Trump's reciprocal tariff plans. They fear that these plans will increase inflation and slow economic growth.

As of 0328 GMT, spot gold remained at $3.019.72 per ounce. U.S. Gold Futures fell 0.1% to $3.023.60.

There are concerns about the U.S. economy's growth as well as inflation. Soni Kumari is a commodity analyst at ANZ. She said that the U.S. could face a stagflationary situation, which would support prices.

In March, U.S. consumer sentiment plunged to its lowest level in over four years. Households fear a future recession and increased inflation caused by tariffs.

Markets are nervous about the potential reciprocal tariffs the U.S. government might implement on April 2.

Trump's tariff policy is likely to cause inflation, which could slow down economic growth and increase trade tensions.

Gold, which is traditionally seen as an investment against geopolitical or economic uncertainty, has increased 15% this year. It reached its highest level of $3,057.21 in March.

Later in the day, several Federal Reserve officials will speak to provide more insight into this year's financial policy.

The markets are waiting for the U.S. The Fed will be looking at the Personal Consumption Spending data due out on Friday to determine its next move.

"We forecast $3,200 by Septembre," Kumari said. She added that any hawkish comments from the Fed may be a factor in gold's rally.

The United States and Russia reached agreements on the geopolitical side of things. They agreed to stop their attacks against Ukraine at sea, and Russia against energy targets. Washington also agreed to press for the lifting of some sanctions against Moscow.

Platinum eased by 0.1% to $975.45. Spot silver dropped 0.2% to $33.69 per ounce. Palladium fell 0.3% to $953.45. (Reporting and editing by Anushree mukherjee, Bengaluru. Sumana nandy and Janane Venkatraman).

(source: Reuters)